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France signs landmark US $ 253 million loan agreement to boost African Development Fund
The African Development Fund (ADF) has signed a significant concessional donor loan agreement with the Government of France to the tune of $ 253 million as support for the 14th replenishment of the Fund.
Established in 1972, the ADF represents an enduring development partnership between African countries and donors. The Fund is part of the African Development Bank Group and helps to improve the lives of millions of people across Africa through loans and grants to projects and programmes.
Its resources are replenished by donors every three years. The 14th replenishment is intended to mobilize the funds necessary for the period 2017 to 2019.
The acting Vice-President for Finance and Chief Financial Officer at the African Development Bank, Hassatou N’Sele, signed the ADF concessional donor loan agreement with the Deputy Chief Executive Officer of Agence française de Développement (AFD), Jean-Pierre Marcelli, in Paris.
The Agence française de Developpement negotiated and signed the loan agreement on behalf of the French Treasury as part of the contributions of France to the Fourteenth Replenishment of the Resources of the African Development Fund (ADF-14).
The move by France is the first time a donor country would sign a concessional donor loan agreement for the ADF since the Fund management and donors agreed in November 2016 to include a loan component within its financing framework.
Global support for the ADF 14 cycle will help the African Development Bank to continue to deliver very concrete developmental impacts across each of the High 5 areas (Light up and Power Africa, Feed Africa, Industrialize Africa, Integrate Africa, and Improve the quality of life for the people of Africa).
Two other countries have also agreed to provide similar loan supports for ADF 14: Japan (US $ 700 million) and India (US $ 15 million).
The signature of the loan agreements with Japan and India should take place early in 2018, N’Sele said.
The loan component of ADF will enable donor countries to circumvent the fiscal pressure most of them are facing and to provide additional support to ADF-14 through reimbursable funds. Without these innovative instruments, ADF-14 would have been one-third lower than ADF-13.